Aussie Archives - Page 2 of 2 - the patient investor

February 9, 2012

Forex: Euro weak while Aussie strengthens

The euro is testing resistance around $1.32 but the primary down-trend is strong. With 63-day Twiggs Momentum deep below zero, expect another test of primary support at $1.26. Breakout remains likely and would offer a target of $1.20*.

Euro/USD

* Target calculation: 1.26 – ( 1.32 – 1.26 ) = 1.20

The Aussie dollar has surged ahead of the CRB Commodities Index which it tracks quite closely. Breakout above $1.08 would signal a primary advance to $1.20*.

Australian Dollar/USD

* Target calculation: 1.08 + ( 1.08 – 0.96 ) = 1.20

Canada’s Loonie shows a similar pattern, testing resistance at $1.01. Breakout would offer a target of $1.06*.

Canadian Dollar/USD

* Target calculation: 1.01 + ( 1.01 – 0.96 ) = 1.06

Pound Sterling followed through above the descending trendline, indicating that the primary down-trend is over. Recovery of 63-day Twiggs Momentum above zero would strengthen the signal. Only a breakout above 41.62, however, would signal the start of a primary up-trend.

Pound Sterling/USD

The greenback continues to test support at ¥76. Breakout would signal another decline, this time with a target of ¥72*. Long-term bullish divergence on 63-day Twiggs Momentum, however, indicates that the down-trend is slowing; breach of the descending trendline would strengthen the signal. Recovery above ¥80 would signal a primary up-trend.

USD/Japanese Yen

* Target calculation: 76 – ( 80 – 76 ) = 72

The South African Rand unexpectedly broke downwards from its bullish ascending triangle against the Aussie Dollar; follow-through below R8.00 would signal a correction to R7.50 (and the long-term trendline).

Australian Dollar/South African Rand

December 8, 2011

Forex update

The euro is likely to re-test primary support at $1.32 against the greenback. Declining 63-day Twiggs Momentum, below zero, warns of continuation of the primary down-trend. Breach of support would indicate a primary decline to $1.22*.

EURUSD

* Target calculation: 1.32 – ( 1.42 – 1.32 ) = 1.22

Sterling rallied off primary support at $1.53/$1.54 against the greenback but 63-day Twiggs Momentum again warns of a primary down-trend. Failure of support would offer a target of $1.46*.

GBPUSD

* Target calculation: 1.53 – ( 1.60 – 1.53 ) = 1.46

Canada’s Loonie is headed for another test of resistance at $1.01 against the greenback. Declining 63-day Twiggs Momentum, however, continues to warn of a primary down-trend. Respect of resistance is likely, and would signal another test of primary support at $0.95. Declining commodity prices also favor a down-trend.

CADUSD

* Target calculation: 0.95 – ( 1.01 – 0.95 ) = 0.89

The Aussie Dollar appears stronger than the Loonie, which is unusual. Both are affected by commodity prices, but the Aussie tends to be more volatile than its Canadian counterpart. Obviously, higher interest rates in the Southern hemisphere are an attraction. Again, 63-day Twiggs Momentum warns of a primary down-trend. And reversal below parity would warn of another test of primary support at $0.95.

AUDUSD

* Target calculation: 0.95 – ( 1.07 – 0.95 ) = 0.83

The greenback has strengthened sharply against the South African Rand and Brazilian Real. Both volatile, resource-rich currencies are likely to re-test their recent highs: the rand at R8.50 and the real at 1.90 against the dollar.

USDZAR

The greenback shows strong bullish divergence against Japan’s yen on 63-day Twiggs Momentum, warning of a reversal. Breach of the long-term descending trendline would strengthen the signal. Breakout above ¥80 would confirm.

USDJPY

November 17, 2011

Aussie and Loonie test support

The Aussie is testing support at parity against the greenback. The “iceberg” on 63-day Twiggs Momentum indicates a primary down-trend. Failure of parity would test primary support at $0.94 and, in the long-term, breach of primary support would signal a decline to $0.80*.

AUDUSD

* Target calculation: 0.94 – ( 1.08 – 0.94 ) = 0.80

63-Day Twiggs Momentum indicates a stronger down-trend on Canada’s Loonie. Failure of support at $0.975 would test primary support at $0.94 and, in the long-term, breach of the $0.94 level would signal decline to $0.80*.

CADUSD

* Target calculation: 0.94 – ( 1.01 – 0.94 ) = 0.87

The Aussie and Loonie normally move in sympathy with the CRB Commodities Index and a CRB break of its primary down-trend would warn of a reversal on the above two currencies.

November 10, 2011

Aussie and Loonie hurt by dollar surge

The Aussie broke short-term support at $1.02, signaling a test of parity. The descending 63-day Twiggs Momentum “iceberg” warns of a primary down-trend. Breach of parity would indicate another visit to primary support at $0.94. In the long-term, failure of primary support would offer a target of $0.80*.

AUDUSD

* Target calculation: 0.94 – ( 1.08 – 0.94 ) = 0.80

Canada’s Loonie “peeked” briefly above parity before retreating to test support at $0.975/0.980. Descending 63-day Twiggs Momentum, below zero, indicates a primary down-trend. Breach of support would test $0.94; and failure of primary support at $0.94 would offer a target of $0.88*.

CADUSD

* Target calculation: 0.94 – ( 1.00 – 0.94 ) = 0.88

November 3, 2011

Aussie Dollar

The Aussie Dollar is headed for a test of support at $1.01/$1.00. Recovery above $1.08 would complete an inverted head and shoulders, but there is still some way to go. Breach of support would warn of another primary decline. In the long-term, failure of support at $0.94 would offer a target of $0.80, while breakout above $1.08 would indicate a target of $1.22.

AUDUSD

* Target calculation: 0.94 – ( 1.08 – 0.94 ) = 0.80

October 5, 2011

Commodities drag Aussie Dollar and Loonie lower

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Falling commodity prices have started a primary down-trend on both the Australian and Canadian dollar. The Aussie rallied off support at its target of $0.94, but respect of the (secondary) declining trendline would warn of further losses.

AUDUSD

* Target calculation: 1.02 – ( 1.10 – 1.02 ) = 0.94

The Loonie also bounced of $0.94 and is testing the first line of resistance at $0.9650. Respect would again warn of further losses.

CADUSD

* Target calculation: 1.00 – ( 1.06 – 1.00 ) = 0.94

September 22, 2011

Loonie turns, will Aussie follow?

Canada’s Loonie broke parity against the greenback, confirming a primary down-trend and offering an initial target of $0.94*.

CADUSD

* Target calculation: 1.00 – ( 1.06 – 1.00 ) = 0.94

The Canadian and Aussie Dollars have tracked each other closely over the last year and it seems inevitable that the Aussie will follow the Loonie below parity.

CADUSD and AUDUSD